BILL NUMBER: AB 2612	CHAPTERED  09/24/00

	CHAPTER   607
	FILED WITH SECRETARY OF STATE   SEPTEMBER 24, 2000
	APPROVED BY GOVERNOR   SEPTEMBER 23, 2000
	PASSED THE SENATE   AUGUST 25, 2000
	PASSED THE ASSEMBLY   AUGUST 25, 2000
	AMENDED IN SENATE   JUNE 12, 2000
	AMENDED IN ASSEMBLY   MAY 26, 2000
	AMENDED IN ASSEMBLY   APRIL 13, 2000

INTRODUCED BY   Assembly Member Brewer
   (Coauthor:  Assembly Member Maldonado)

                        FEBRUARY 25, 2000

   An act to amend Section 401.10 of the Revenue and Taxation Code,
relating to taxation.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 2612, Brewer.  Taxation:  pipeline assessment and interest.
   The Sales and Use Tax Law provides that interest is paid by
taxpayers with respect to underpayments of tax at the modified
adjusted rate, as defined by reference to a specified federal
statute, and that interest is paid to taxpayers with respect to
overpayments of tax as determined in accordance with a specified
federal statute, which requires that the rate paid on overpayments be
based on the rate of 13-week treasury bills, as specified.
   This bill would declare the Legislature's intent to delete the
requirement that interest on overpayments be based on the rate of
13-week treasury bills and instead require that interest on both
underpayments and overpayments be determined in accordance with the
specified federal statute, as modified.
   Existing property tax law requires any property, not exempted from
taxation by federal law or pursuant to the California Constitution,
to be assessed at its full value.  Existing law also establishes a
rebuttable presumption of valuation at full value, provided certain
conditions are met, for each tax year from the 1984-85 tax year to
the 2000-01 tax year for intercounty pipeline rights-of-way on
publicly or privately owned property.
   This bill would extend the application of this rebuttable
presumption to the 2010-11 tax year.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  It is the intent of the Legislature to do both of the
following:
   (a) Eliminate the requirement that the rate of interest accruing
on overpayments of sales and use tax be based on the rate of 13-week
treasury bills issued by the federal government.
   (b) Require, subject to certain modifications, that the rate of
interest accruing on both overpayments and underpayments of sales and
use tax be determined in accordance with the rate of interest
determined under Section 6621(a) (2) of the Internal Revenue Code for
underpayments of federal taxes.
  SEC. 2.  Section 401.10 of the Revenue and Taxation Code is amended
to read:
   401.10.  (a) Notwithstanding any other provision of law relating
to the determination of the values upon which property taxes are
based, values for each tax year from the 1984-85 tax year to the
2010-11 tax year, inclusive, for intercounty pipeline rights-of-way
on publicly or privately owned property, including those
rights-of-way that are the subject of a change in ownership, new
construction, or any other reappraisable event during the period from
March 1, 1975, to June 30, 2011, inclusive, shall be rebuttably
presumed to be at full cash value for that year, if all of the
following conditions are met:
   (1) (A) The full cash value is determined to equal a 1975-76 base
year value, annually adjusted for inflation in accordance with
subdivision (b) of Section 2 of Article XIIIA of the California
Constitution, and the 1975-76 base year value was determined in
accordance with the following schedule:
   (i) Twenty thousand dollars ($20,000) per mile for a high density
property.
   (ii) Twelve thousand dollars ($12,000) per mile for a transitional
density property.
   (iii) Nine thousand dollars ($9,000) per mile for a low density
property.
   (B) For purposes of this section, the density classifications
described in subparagraph (A) are defined as follows:
   (i) "High density" means Category 1 (densely urban) as established
by the State Board of Equalization.
   (ii) "Transitional density" means Category 2 (urban) as
established by the State Board of Equalization.
   (iii) "Low density" means Category 3 (valley-agricultural),
Category 4 (grazing), and Category 5 (mountain and desert) as
established by the State Board of Equalization.
   (2) The full cash value is determined utilizing the same property
density classifications that were assigned to the property by the
State Board of Equalization for the 1984-85 tax year or, if density
classifications were not so assigned to the property for the 1984-85
tax year, the density classifications that were first assigned to the
property by the board for a subsequent tax year.
   (3) (A) If a taxpayer owns multiple pipelines in the same
right-of-way, an additional 50 percent of the value attributed to the
right-of-way for the presence of the first pipeline, as determined
under paragraphs (1) and (2), shall be added for the presence of each
additional pipeline up to a maximum of two additional pipelines.
For any particular taxpayer, the total valuation for a multiple
pipeline right-of-way shall not exceed 200 percent of the value
determined for the right-of-way of the first pipeline in the
right-of-way in accordance with paragraphs (1) and (2).
   (B) If the State Board of Equalization has determined that an
intercounty pipeline, located within a multiple pipeline right-of-way
previously valued in accordance with subparagraph (A), has been
abandoned as a result of physical removal or blockage, the assessed
value of the right-of-way attributable to the last pipeline enrolled
in accordance with subparagraph (A) shall be reduced by not less that
75 percent of that increase in assessed value that resulted from the
application of subparagraph (A).
   (4) If all pipelines of a taxpayer located within the same
pipeline right-of-way, previously valued in accordance with this
section, are determined by the State Board of Equalization to have
been abandoned as the result of physical removal or blockage, the
assessed value of that right-of-way to that taxpayer shall be
determined to be no more than 25 percent of the assessed value
otherwise determined for the right-of-way for a single pipeline of
that taxpayer pursuant to paragraphs (1) and (2).
   (b) If the assessor assigns values for any tax year from the
1984-85 tax year to the 2010-11 tax year, inclusive, in accordance
with the methodology specified in subdivision (a), the taxpayer's
right to assert any challenge to the right to assess that property,
whether in an administrative or judicial proceeding, shall be deemed
to have been raised and resolved for that tax year and the values
determined in accordance with that methodology shall be rebuttably
presumed to be correct.  If the assessor assigns values for any tax
year from the 1984-85 tax year to the 2010-11 tax year, inclusive, in
accordance with the methodology specified in subdivision (a), any
pending taxpayer lawsuit that challenges the right to assess the
property shall be dismissed by the taxpayer with prejudice as it
applies to intercounty pipeline rights-of-way.
   (c) Notwithstanding any change in ownership, new construction, or
decline in value occurring after March 1, 1975, if the assessor
assigns values for rights-of-way for any tax year from the 1984-85
tax year to the 2010-11 tax year, inclusive, in accordance with the
methodology specified in subdivision (a), the taxpayer may not
challenge the right to assess that property and the values determined
in accordance with that methodology shall be rebuttably presumed to
be correct for that property for that tax year.
   (d) Notwithstanding any change in ownership, new construction, or
decline in value occurring after March 1, 1975, if the assessor does
not assign values for rights-of-way for any tax year from the 1984-85
tax year to the 2010-11 tax year, inclusive, at the 1975-76 base
year values specified in subdivision (a), any assessed value that is
determined on the basis of valuation standards that differ, in whole
or in part, from those valuation standards set forth in subdivision
(a) shall not benefit from any presumption of correctness, and the
taxpayer may challenge the right to assess that property or the
values for that property for that tax year.  As used herein, a
challenge to the right to assess shall include any assessment appeal,
claim for refund, or lawsuit asserting any right, remedy, or cause
of action relating to or arising from, but not limited to, the
following or similar contentions:
   (1) That the value of the right-of-way is included in the value of
the underlying fee or railroad right-of-way.
   (2) That assessment of the value of the right-of-way to the owner
of the pipeline would result in double assessment.
   (3) That the value of the right-of-way may not be assessed to the
owner of the pipeline separately from the assessment of the value of
the underlying fee.
   (e) Notwithstanding any other provision of law, during a four-year
period commencing on the effective date of this section, the
assessor may issue an escape assessment in accordance with the
specific valuation standards set forth in subdivision (a) for the
following taxpayers and tax years:
   (1) Any intercounty pipeline right-of-way taxpayer who was a
plaintiff in Southern Pacific Pipe Lines, Inc. v. State Board of
Equalization (1993) 14 Cal. App. 4th 42, for the tax years 1984-85 to
1996-97, inclusive.
   (2) Any intercounty pipeline right-of-way taxpayer who was not a
plaintiff in Southern Pacific Pipe Lines, Inc. v. State Board of
Equalization (1993) 14 Cal. App. 4th 42, for the tax years 1989-90 to
1996-97, inclusive.
   (f) Any escape assessment levied under subdivision (e) shall not
be subject to penalties or interest under the provisions of Section
532.  If payment of any taxes due under this section is made within
45 days of demand by the tax collector for payment, the county shall
not impose any late payment penalty or interest.  Taxes not paid
within 45 days of demand by the tax collector shall become delinquent
at that time, and the delinquent penalty, redemption penalty, or
other collection provisions of this code shall thereafter apply.
   (g) For purposes of this section, "intercounty pipeline
right-of-way" means, except as otherwise provided in this
subdivision, any interest in publicly or privately owned real
property through which or over which an intercounty pipeline is
placed.  However, "intercounty pipeline right-of-way" does not
include any parcel or facility that the State Board of Equalization
originally separately assessed using a valuation method other than
the multiplication of pipeline length within a subject property by a
unit value determined in accordance with the density category of that
subject property.
   (h) This section shall remain in effect only until January 1,
2011, and, as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2011, deletes or extends
that date.
